Today, we want to discuss emerging trends in the market. Trends that should see plenty of profits moving forward, regardless of economic shocks caused by COVID-19 or the election volatility.
Some trends that we see moving prices higher and some to the downside.
First, let’s talk about how the major indices are moving. We can then use that info to branch off into more specific sectors we see major investment opportunities.
These stock indices usually have a high degree of correlation and therefore perform in sync with each other. In the last few years, however, they have diverged significantly.
Historically, when the Russell has performed worse than the S&P, it has rebounded to outperform the larger market-cap index for the next three years. Since the election, the Russell is up 3% more than the S&P 500 and still has roughly 12% more to go before it makes up its ground from the last few years.
Keep in mind that when the indices are growing, Russell 2000 stocks grow 6.5% higher, on average, than S&P 500 stocks.
What does this mean for 2021 and specific investments?
As we recover from the pandemic (however slowly) and the trade war tensions with China diminish, investors can stay away from the FAANG stocks and concentrate on some emerging stocks poised for growth.
Watch the full interview to find out what stocks we think are going to boom in 2021.
What we can tell you here is the biggest boom of them all is slated to come online as soon as January 2021. A tech revolution that could see growth unseen in the technology industry since the boom of the internet!
Watch my special presentation outlining how you can become an early investor and profit from this history-making event.
Midas Letter is provided as a source of information only, and is in no way to be construed as investment advice. James West, the author and publisher of the Midas Letter, is not authorized to provide investor advice, and provides this information only to readers who are interested in knowing what he is investing in and how he reaches such decisions.
Investing in emerging public companies involves a high degree of risk and investors in such companies could lose all their money. Always consult a duly accredited investment professional in your jurisdiction prior to making any investment decision.
Midas Letter occasionally accepts fees for advertising and sponsorship from public companies featured on this site. James West and/or Midas Letter may also receive compensation from companies affiliated with companies featured on this site. James West and/or Midas Letter also invests in companies on this site and so readers should view all information on this site as biased.